The proposed joint venture would provide comprehensive investment banking services, including stock underwriting, initial public offerings, financial consulting and mergers and acquisitions advisory service, to both Chinese companies and overseas firms with offices in China.

The landmark marriage will also make the planned new company, the second joint venture securities house in China, following the founding of China International Capital Co, a securities house co-launched by China Construction Bank and Morgan Stanley in the early 1990s.

"Changjiang Securities Co will have a dominant two-thirds stake in the new company," said Ming Yuncheng, chairman of Changjiang, with the remaining one-third going to BNP Paribas Peregrine when the company is officially launched, which is believed to be just months away.

As a wholly owned subsidiary of BNP Paribas and its equity investment banking arm in the Asia-Pacific region, BNP Paribas Peregrine has been designated to implement the joint venture and is prepared to do so.

Currently, the two sides are still waiting for the official issue of the regulations for the establishment of Sino-foreign joint venture securities firms in China. China has promised foreign joint partners could acquire a one-third stake in joint venture securities houses within three years of China's WTO entry.

"A formal application will be submitted to the regulatory authorities when the rules are released," said Ming.

"The combination of our strong local networks with our foreign partners' international expertise should generate huge business opportunities in China,'" said Ming, at the signing ceremony.

"The landmark action marks China's further opening-up of its equity market, and it will bring significant changes to China's stock market," said Dong Fureng, a renowned economist, adding that it signals that China has already begun to take moves to fulfil its WTO commitment.

"And it also marks the first step for China's stock firms' going abroad," said Dong.

(China Daily March 8, 2002)